Wednesday 21 November 2018

Revealed: How much rents have rocketed above Celtic Tiger peak

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Charlie Weston

Charlie Weston

The cost of renting a home continues to surge to levels well above those seen during the Celtic Tiger.

It is now almost €3,000 a year more expensive to rent a property than it was during the height of the property boom.

Rents rose nationwide by an average of 11.5pc in the year to March, according to the latest quarterly Rental Report by Daft.ie.

It was the eighth quarter in a row of double-digit rises and a new all-time high.

The average monthly rent nationwide during the first quarter of this year was €1,261.

This is €230 a month more than the highest level reached during the property boom back in 2008.

Over a year, the higher costs of renting now compared with a decade ago works out at €2,784 a year.

Dublin rents have gone up 12.8pc, with the cost in the capital now €430 a month more than the previous peak a year ago.

This is 30pc higher than during the last peak.

The figures are for new rental agreements, as rent caps are in place for existing tenants.

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Rental costs are continuing to rise at a rapid rate in other cities.

Limerick experienced a jump of 17pc in the cost of renting in March compared with a year ago.

And tiny numbers of homes are available to rent.

There were just 3,086 properties available to rent nationwide in April.

This is the lowest number ever recorded for this time of year since the series started in 2006.

Last year there were nearly 500 more properties for rent.

In Dublin, there were just 1,265 homes available to rent, one-third below the average over the last five years.

Economist at Trinity College Dublin and author of the Daft Report Ronan Lyons said the State needs close to 50,000 homes a year to cater to underlying housing demand.

He said more than 15,000 rental homes are needed each year.

Dublin alone needs an apartment block of about 200 units to open every week from now until the 2080s.

Prof Lyons said the increases show no signs of moderating.

"With the exception of Donegal - where Brexit is having a clear effect on the local market - the problem is countrywide, although it is certainly most acute in Dublin," he said.

He said it was clear rental inflation was well above any reasonable measure of wealth. But rents are only a symptom of the housing crisis.

He said: "The cause remains a chronic and worsening lack of rental supply. Policy must focus on dramatically increasing the construction of urban apartments over the coming years."

The average monthly rental cost in Dublin is now €1,875, up 12.4pc from a year ago. In Cork, there has been a 9.3pc rise in the cost to €1,210 a month.

Average rents in Galway are up 13.6pc in a year to €1,131. In Limerick, it costs €1,044 to rent, which is 17pc higher than last year, with a rise of 14.6pc in Waterford to €868.

In the rest of the country the average rental cost is €883, up 10pc.

Housing charity Threshold said the latest rent rises show rent pressure zone enforcement measures were not adequate.

Chief executive John-Mark McCafferty said violations of the rent pressure zone legislation must be treated as a criminal offence.

A rent pressure zone is an area where rent increases are capped at 4pc a year.

Irish Independent

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